How Audi, BMW & Mercedes Plan To Compete With Tesla--And Why

We already know that in the next few years, we'll see a slew of mid-size SUVs offered with plug-in hybrid powertrains--most from luxury brands like Audi, BMW, Mercedes, Porsche, and Range Rover.

But the German luxury marques are making plans to compete more directly with Tesla Motors and its Model S all-electric long-range luxury sedan.

All have current or upcoming luxury plug-in hybrid models--but only BMW offers one battery-electric vehicle, and it's the i3 city car. (Mercedes-Benz also has the low-volume B-Class Electric Drive, on sale in limited areas of the U.S.)

According to various news reports, several of those luxury brands plan to offer all-electric sedans before the end of the decade that would essentially line up against the Tesla Model S or an updated version of the car.

For instance, Germany's Manager Magazin (via Motor Authority) cited industry sources saying that the upcoming smaller Porsche sedan (now known as "Pajun," for Panamera Junior) will include an all-electric version.

To be launched at the end of 2017 or later, the Q8 e-tron would have the upcoming Tesla Model X electric SUV squarely in its sights.

BMW is thought to be working on larger, more upmarket all-electric vehicles based on its i3 architecture. And, finally, Mercedes-Benz is said to be considering an all-electric version of its S-Class large luxury sedan.

All of those vehicles except the BMW would presumably use largely steel construction, which would make them considerably heavier than the all-aluminum Model S.